"Better to remain silent and be thought a fool, than to speak out and remove all doubt"
It's not easy deciding on a presidential candidate. The debate between Mitt Romney and George W Bush didn't help me. ......but that's not important.
What IS important is the Gomberg-Fredrikson Report for May shows cumulative bulk imports accounted for 19.3 million case equivalents shipped into the US in 2012; a whopping 167% increase. That's the equivalent harvest of 27,000 acres of US winegrapes calculated at 12 tons per acre.
That quote above the headline picture? It's often attributed to Abraham Lincoln, but similar renderings can be found in Mother Goose, in Mark Twain's writing, and even King Solomon in Proverbs 17:28. That quote - talking instead of remaining quiet - is the core risk when speaking with the press. (Lesson #15 in dealing with the press: You don't have to answer the question especially when it's a leading question.)
I like to tell reporters "I can't wait to read the article so I can see what I said." While ninety-nine percent of the time the press does a great job, on occasion there is a degree of 'stylistic enhancement' shall we say? .... a little fanning of the flame to sell digital ink perhaps? I can tell you first hand being force-fed a diet of your own foot in the media is no way to lose weight or gain friends.
Inserting My Foot In My Mouth
One such time I wished I'd heeded that wisdom was in 2004 when I wrote in a report the San Joaquin Valley stood a chance of sharing Detroit's fate from the 1970s. A well-read wine journalist at the time decided to interpret my remarks in his own way missing entirely the nuance in my point. (Lesson #16 in dealing with the press: Nuance is bad. Sound bites are good.)
The consequence was that I was viewed by folks in Fresno somewhere between the devil incarnate and a clown. Knowing there was is no way to 'un-ring the bell' in the media, I called up Nat DiBuduo and Carson Smith, both senior leaders in the grape growing business in California's Central Valley. I'd never met either but offered to buy them lunch at a Red Lobster in Stockton to exchange views. Carson had Tilapia baked in a brown bag paired with a Woodbridge Chardonnay and I had ....well that's not important.
What IS important is they agreed to meet me and came without any sidearms or spoiled vegetables to throw.
Trying to Extricate My Foot
The U.S. automakers never in a million years thought American's would accept small Japanese cars which had a history of poor quality at the time, over the better quality and powerful American cars equipped with soft Corinthian leather (see video). But Japan was evolving and had a solution ready for the oil shocks that caused gas lines in 1974: competitively priced cars that got good gas mileage. Americans changed their behavior and bought foreign cars.
When I was considering that era I noted Japan had a currency advantage from a very strong dollar. There was a world-changing event with the forming of OPEC that led to an opening for imports and a business-as-usual mindset that you could see in Detroit's advertising. (Note at the end of the Chrysler commercial, the Cordoba is described as a small car.)
As is often the case with market direction, things continue with momentum until the market hits an air pocket forcing change. That momentum of success hid the market threat from Motown. I saw a corollary in the Central Valley winegrape industry 8 years ago. The dollar was gaining strength. There was a world-changing event taking place; the Internet was shrinking the globe, Ciatti and Turrentine grape brokers were looking to expand their world network and I believed that would allow an opening for foreign wine to be imported in bulk squeezing out domestic growers. I didn't see any real coordination of resources directed at the threat.
What I Really Meant to Say Was ...
A marketing order has worked for the Almond Industry. The Pistachio trade had flourished with an order. Advertising worked for the Dancing Raisins. Why not California winegrapes?
Nat and Carson were incredibly kind and patient and offered their own perspectives on the business. It's great to have made their connection because they are really incredibly wise and experienced businessmen. I finished my fish and chips paired with a citrus-nosed sauvignon blanc.... but that's not important. What IS important is we had a good conversation and I came away with some new thoughts and not too many bruises.
Getting a Do-Over
Flash forward to last summer. I was invited by Nat and Carson to come and speak to the San Joaquin Valley Wine Growers Association. I was to be the warm-up act for one of the reigning celebrities in the wine business, Joe Gallo <gratuitous name drop>. Of course, I gladly accepted the invitation.
On the way down, I stopped in at Cardella Winery for lunch and a tasting of their limited-production wines. The family was generous with their time and hospitality. The wines I liked the most were their Sangiovese, Barbera, and Chardonnay. While this isn't a wine tasting Blog, I have to say all the wines were really well made and a steal for under $20 ...... I just stopped writing and went online to buy a half case of their Sangiovese .... but that's not important.
What IS important is I didn't think the terms limited-production and San Joaquin Valley were really synonymous. But there is a growing number of wineries in the region taking that approach. My view of the Big Valley is as the producer of gateway and value wines for the US and world consumers and while that's largely true, I was really impressed by the efforts of the Cardella Family. I can see more opportunities for the region in their efforts.
Some Revelations and Solutions
The reality is there are continuing advances in winemaking and vineyard management practices mostly from Fresno State that are driving wine quality higher by the day in the Big Valley and creating better and better value wines for the US consumer, but the actual marketing and promotion of California wine continues to languish after a long period of successful marketing that began in the '60s with Italian Swiss Colony.
I gave about a forty-minute speech before having lunch of prime rib paired with Gallo Cabernet that was round and ripe with a slight nose of .... well that's not important.
The dollar is getting stronger and the reaction by big wine producers has been to import 19,300,000 cased equivalents in bulk wine thus far in the year. But it's not just a bulk wine threat. The same threat is there for smaller producers when Millennials haven't been exposed to mass-marketing of California wines and are more than willing to experiment with wine from countries such as Argentina, Spain, Portugal, Italy, Chile, and Australia who present a cost and value challenge and in some cases have a state-supported marketing budget.
What IS Important
What IS important is it's time to restart the dialogue on a USDA Marketing Order. I recognize the political distance that exists with all the existing XXX.orgs focusing narrowly on their specific mandates, but the efforts can be symbiotic. It's time to have that discussion and I'm wondering who will step forward from within the wine business to coalesce the people and information, define the threat and opportunity, and execute a plan?
After my speech dessert was served of Tres Leche cake paired with a sweet white dessert wine that had a hint of apricot and... well that's not important. What IS important is it's time to think about a marketing order that enhances the brand of authentic California and US wines.
Before leaving the podium in Fresno, I presented an example of iconic advertising from many years ago. Then before leaving, I said, "Thank you for your support."
What are your thoughts?
Rob,
ReplyDeleteWhile I agree on many of the points, I don't always see the connection.
I agree that CA wine is probably at a Pricing Inflection Point. But I don't think that promoting CA wine cooperatively (or otherwise) changes that. It increases market share for CA wines certainly but consumers don't look at CA wine vs. the rest of the world (as the blog seems to imply). Rather, we all -- wineries everywhere, play on the world stage and consumers will buy Siduri and if they don't they will buy an Oregon Pinot or a New Zealand Pinot or a South African Pinot.
I think that the solution to a Pricing Inflection Point is only to promote wine in general and acquire more wine drinkers, period, whether they drink CA wine or others. More drinkers, more demand of wine as a whole is, IMO, the only solution.
Adam Lee
Siduri Wines
Good comment Adam. Sounds like we agree there is a likelihood all CA wines are at a pricing inflection point when compared to the world stage. We also agree promotion is a good thing because it increases the size of the pie.
DeleteWhere we don't see eye to eye is whether or not promotion can build the brand of California wine. I think promotion of a product does build a brand image and when a consumer has a choice between wines, with marketing/advertising/promotion in the background of their product selection decision, they will have a better chance of selecting any given product if the promotion is effective. And if consumers are more inclined to make that choice, higher demand equates to pricing support.
Part of the key in effective promotion is money and at this stage, there isn't enough money directed toward, nor is there a single entity focused solely on the promotion of CA wine. The Wine Institute is as close as it gets, but their role is more to work on public policy. They are geared toward creating a landscape where promotion can be more effective.
If I remember my college economics correctly (and I doubt I do), part of the question is whether you view non-Californian wine as a "substitute-good" to California wine or a "complimentary-good" to California wine in the United States. I would argue that, in a country as large as the USA with a per-capita consumption of wine that isn't even in the Top 50 in the world, it makes more sense to view them as "complimentary-goods" in that they increase the overall market and have the opportunity to increase sales of CA wine.
DeleteI do realize I am arguing for something even more difficult to achieve, the overall promotion of wine drinking, and that we don't seem to even agree on the promotion of CA wine....so I am not holding my breath for it to happen.
Adam Lee
Siduri Wines
We have to think about value because thats always what the consumer thinks .... Mercedes or Kia, they want value. Largely, that math for value is Perceived Quality divided by Price. If the Perceived Quality goes up holding price constant (either by enhancing perception or by delivering greater "utility") then value increases. The other way to approach that equation is to lower price and hold P.Q. constant. Value will go up with a cheaper price.
DeleteIts really hard to talk about perceived quality in absolute terms when it comes to fine wine because its art, and beauty is in the eyes of the beholder. But I think we can agree that other countries are having improved success at cracking the US market either by promotion (see the Wines of Rioja) or because they are improving in their own quality or approach to the US pallate, or because of favorable exchange rates.
Without getting too detailed on econ, foreign wine is a substitute. Its not a complimenrary good. As a substitute, the increase in cost of our wine will enhance the opportunity for the sale of foreign wine.
The promotion of wine drinking is absolutely doable but thats not the argument. Promoting wine drinking expands the pie for substitutes for CA wine, including wines from abroad and domestically. Thats not a successful approach if the expense of promotion comes from CA business people. Promotion of CA wines paid for by CA business people will diffentiate the product - foreign or domestic and allow the maintenance and improvment of pricing in grapes and wine.
Rob,
DeleteSo, tell me...has the increase recently in the sales of non-Californian wine led to a decrease in the sales of California wine? I don't believe that I have seen that. In fact, in recent times, when Australian wine was booming, so was CA wine. Sales of non-California wines are up now (correct?) but aren't also sales of higher end CA wine? I don't see that an increase in one has led to a decrease in the other. Honestly, correct me if I am incorrect.
Adam Lee
Siduri Wines
Adam -
DeleteYou are looking at the wrong metric. If we want to look at volume, then the answer is no - CA sales continue to increase. But looking at market share, CA wines are decreasing and imports are gaining. Said another way, the growth in sales could be much better than it is - because of the sales made in foreign wines.
If there were no imports (just a logical argument) the demand for CA wines are higher and can be priced higher.
So, I am not sure I get it. France, which has no foreign wines, their sales are down 3% per capita over the last 4 years, but the United States, with competition, sees an overall increase of 5.1% in per capita sales and an increase in both domestic and foreign wine volume. How's that looking at in the wrong way?
DeleteAdam Lee
Siduri Wines
Rob,
DeleteYou state that import wines are a "substitute" to locally made and I think that is where our views diverge, as they do with any and all somms and retailers out there claiming the same. I am pretty much averse to oak, in my wines as well as any other producer's, and American oak to even greater degree. Most cheap(er) imports substitute oak flavors for the lack of fruit in their wines. While they will be first to tell you just how much they hate lots of oak in wine and inferior wine making (additions to add color, etc.) they are the first ones to reach for that bottle of Rioja or Malbec. I just had a bottle of Yarden Pinot Noir, great nose opens up to deep flavors of oak, oak and more oak, it clamps down on the palate. The retailer sold it as a "great value" wine, as you seem to describe them and yet I am lost at words when I think oak flavors sold as wine. No balance, harsh oak tannins and this is what is sold to consumers as "great value" when wines such as Adam's for example, can be had for same price or a bit more and enjoyed MUCH MORE. IMHO, of course. I stopped drinking Australian wines a while ago, pickle juice can actually be had with a great pickle to go along. Problem is that our wine publications review process and that of wine buyers (retailers, restaurants) is greatly flowed and based on palates that themselves require (re)education. I cringe every time I see "leather aromas" and then a great score attached to a wine, nothing can be worse than selling consumer on a brett infected wine and teaching them to accept it. Moreover, PAY for it.
GregP - Your comments are all the more supportive of the promotion and markeing of CA wines. You are focused on the qualitative view of US wines and that is probably consistent with my own. But price is a part of the value equation and its an important component. To improve our own lot in the world, I think we should consider marketing the product domestically produced.
DeleteI really appreciate your comments!
Great, then what do you propose wineries do? Please read my reply to Mark below and point out just what wineries can do.
DeleteAdam,
ReplyDeleteGreat comments, although I have a different question: How do you promote CA wine when most retailers and sommeliers do anything but? And actually go out of their way to promote imports, even in Bay Area.
We are the only country in the world doing that, besides Russia and China I think, who have no really great wine made locally. Every other wine producing country mostly ells their local products.
Greg - I know this is directed to Adam, but let me offer a quick response: Promotion includes giving somms and retailers information and sound-bites from which to sell. I don't think we want to sell US wines by trying to get the trade to not sell foreign wines. The best approach in a free market is to out-compete the foreign suppliers so the retailers want to sell the domestic wines.
DeleteMany other countries place tarrifs on imports to build in their domestic capabilities. I'm not familiar with the current tarrif system in China or Russia but believe both have some stiff tarrifs. I do know that the Chinses government is supporting the development of their own wine industry... on that point we agree. I wouldn't however want to slap higher tarrifs on imported wines. That's not my idea of improving value for the consumer since price goes up.
Rob,
DeleteYou can't imagine how much wine I pour for free and actually leave bottles for buyers to taste at their convenience. But when I am told "we have limited shelf space", which is visibly occupied by imports I most of the time wouldn't drink for free if provided, I have an issue with the entire system. And outside of CA, most retailers either deal with 2-3 distributors (big guys, you know who they are) or can't get the product in. How does that "educate" consumer in any way of what's really available in CA? White Zin and Barefoot Cab is not what Adam does last time I checked. Neither do I. And the wines do NOT represent what CA can do. Again, whose fault is it, wineries' or the 3-tier system based on corruption? We can all we want, but as wineries, there is not really much that can be done when a restaurant openly declares than no CA made wine fits their menu. Utter lie and bad for consumers.
Have no idea about China, but in Russia the market is really crazy. Importers either open their own retail shops to sell their products or PAY hefty fees for shelf space (or wine list placement), more than your profit margin when all is said and done. 90% of the time. I've never seen anything like it.
Gregg (and Rob),
ReplyDeleteI think that the mindset that "most retailers and somms promote...anything other than CA wines" is a very coastal mindset. There is a huge, potential wine-drinking population in the rest of the country....that doesn't buy their wine from somms (shock of shocks, most of the restaurants don't even have somms) and has retailers that are thrilled to get the sales...the sales of CA wines, and of non-CA wines. They want to sell wines, they want to make their consumers happy, without selling with an agenda. That part of the country...and of the market...is far too often ignored.
Adam Lee
Siduri Wines
Adam,
DeleteI understand, of course. But since we're in the 3-tier distribution model all those retailers depend on distributors to actually carry those wines in the first place and we all know how that works out to the benefit of the consumer. I travel all over these days and rarely see anything I want to actually spend my money on outside of a few shops, all based in CA. On East Coast selection of CA wine is horrible, to be honest, and most of what's being pushed are cheap imports. 3-tier model is the huge issue all around, I taste retailers and restaurants on wine and they can't figure out how to bring it in.
Left Coast is another matter altogether, as discussed before. Very few somms and retailers have a palate, to be frank, and first question out of their mouth most of the time, What's the price point? They really don't care about what's inside the bottle, because, you know, we can sell this here (brett infested) import at much less, consumer be damned.
Its a long discussion and not as simple as described in the blog. Unfortunately. The entire distribution system/model has to change.
The more you stick to writing about the wine business, the better. None of need any additional liberal political gibberish.
ReplyDeleteOh come on .... you have to admit the video is funny.
DeleteMark,
DeleteNot sure we're on same page here. You're actually comparing a 3-tier distribution system where wineries mostly have no input into how their wines are marketed and sold to one where cheese makers can do whatever fits their needs? Really?
I am guessing you're not in wine business and simply taking a stab here. I was pouring wine at our (now ex) distributor in NY, buyer at Merryll stopped by wanting 10 cases of our wine X, to start with. Another buyer specifically came to the tasting that day to place an order on wine Y that I tasted him on the day prior at his restaurant, 3 cases to start with. Others as well. Take a wild guess if any of them actually got the wine when the distributor was pushing other labels. Now, what do you propose I should have done when I cannot sell directly even when I went out of my way prior to the tasting to taste as many people on the wine as I could and educate them on the product?
We cannot educate people in the ENFORCED 3-tier system, we simply can't no matter how we organize.
Education starts on the retail and hospitality level outside of CA and wineries have very little input if the distributor is not interested. Inside of CA, its still who you know for the most part, you can make the best ever wine and only word of mouth can drive sales when all the shops are interested in a sub $10 category. Won't happen.
As for bulk wine, well, its bulk wine. I'd rather drink good beer and I'm in wine business. Simple as that. Life's too short to drink oak infused poor quality grape juice (to keep it polite). Something tells me you don't drink generic vodka nor tequila, have no idea why people settle for "generic" wine.
Clearly it is all George W Bush's fault. Exactly what, in this wandering mass of sludge, I am not sure. Not only did the writer bury the lede, he buried the whole damn thing.
ReplyDeleteI don't believe I've attributed anything to GWB in the post. It is a little wordy though .... a wandering mass of sludge is at least a colorful discription of wordiness. I can appreciate that.
DeleteRob,
DeleteInteresting that you removed my comment and yet left the video on the blog. And you're asking us why we are questioning your motives? Actions, not words...
WI is not the solution (its discovercaliforniawines.com website, launched in 2011, is still not done nor is it avail in other languages).
ReplyDeleteDomestic: just use Southwest's flight patterns and you will find where to go in "flyover-America".
Intl: This is where what I think Ron is talking about is important. WI does policy, as he says, but doesn't do enough trade/consumer promotion. There is money to be used but the industry, as a group, needs to take control.
Wine in America, and in the world, is not 1990s. Nor are the wine drinkers.
Thanks for the comments Kathy. There are many XXX.orgs but none of them today are set up to promote CA wine. Ignoring marketing and promotion with all the shifting that is taking place underfoot increases the risk. Changing consumer behavior (outside of an economic shock) normally takes years of consistent attention. In the same way, paying no attention will - over many years time - can have the same impact in reverse, especially when other countries are providing direct marketing support for exports. The consumer will hear a message. Will it be the one we would prefer they hear?
DeleteTalking about getting off point...WOW....I think Rob was talking about a marketing cooperative effort and the discussion seemed to fall off into politics and many other side issues including the evil 3-tier system and all its shortfalls.
ReplyDeleteUnfortunately, I am from the east coast, and I am not so ingrained with the Californian mentality but I see very weak and fragmented marketing efforts from many wineries because I look at them every day. Marketing seems to always be someone else's job.
Why do the California dairy farmers unite with so many Happy Cow commercials (which I love) and the promotion of "real California Cheese" on TV...somehow I have not heard of an onslaught of foreign cheese makers trying to steal marketshare...yet they do it because some one in their organization is very smart (and probably very influential)...the future that is fast approaching is going to be all about brand marketing...forget the DtC versus 3-tier...won't matter unless your brand name is a recognized one in whatever sales channel you are selling in....cheese...wine or whatever!
A point that did not seem to arise in the commentary discussions was that Californian wine only has to be 75% from California...the big market players (who are buying all this imported bulk wine) will probably be able to delivery their wines to market at a lower cost than last year...don't know what were in the contracts or the prices but my bet is that they are substantially lower than California grape prices...I am talking with brokers nearly every day from Spain, from Italy, from South African who all have huge quantities of bulk wine to sell and are looking here. I also know what is happening to the Euro and don't believe that the latest efforts to stablize the Euro will keep a favorable exchange rate (with the dollar) for long no matter what Draghi does. So that all being said the family farmer with a vineyard who is seeing prices for everything go skyrocketing has a choice as to whether to hold prices or raise them?
I think that the main point was suppose to be something akin to the "unite we stand..divide we will lose marketshare"...no one winery (who makes hand crafted good quality wines) or one association has the financial muscle to mount a national marketing campaign to influence American wine drinkers..but with a organized effort perhaps this can be done! I "think" Rob's post was a call to arms to unite and create a branded name that influences many of the 80 million wine drinkers...and yes BTW the latest stats from the Wine Institute (from 2010) shows the US as the 38th largest "country" in wine consumption on a per capita basis...if we doubled our consumption we'd still only be 24th (I've done the math)...so there is also a chance that we could positively influence wine consumption here...so there are many good reasons to try!
Mark - You nailed the point of the Blog this week: It was "a call to arms to unite and create a branded name that influences many of the 80 million (U.S.) wine drinkers."
DeleteI would love to lead the charge to move on some type of marketing order, but I'm a wine banker and have a full-time job. I'm not the right candidate.
I'm hoping someone is out there reading this wandering mass of sludge and is nevertheless inspired to think about how this might happen, and who would need to be involved.
The people are out there. The need is out there. It needs a spark and at times, thats simply a few people in leadership in the business getting together envisioning the possibility and their involvement and talking. As they say (whoever "they" are): All journeys start with the first step. Who is going to that step?
Ron,
DeleteGreat! Please propose how you would drive the effort, I am sure you'll have plenty of support from all around. Well, at least from wineries :-)
We keep discussing and I have yet to see nor hear anything specific on the subject. I'll be happy to play devil's advocate since I am pretty familiar with how things work in the industry.
Well, let's see, where to get in. Greg P. at some point above mentioned leaving bottles for a retailer. That is not a marketing plan. I agree with author Rob. that lots of .org things exist but not to promote Calif. wine, and too much fragmentation. Even in the new, small, Ramona AVA, with about 20 wineries, there is a move to have a separate growers.org from the vintners org. Come on guys. It is a highly fragmented production market, highly consolidated distribution (SWS, Youngs, Gallo, KJ, Bronco). But most wineries are about the wine, not about a well thought out marketing plan. And the few wineries that are all about marketing, usually have self-centered plans that look foolish to the bulk of the consumers.
ReplyDeleteTo Mark from the East Coast: the happy cows campaign is from mandatory funds from the dairies. The Mendocino wine commission is disbanding. A prominent Norcal wine person is objecting to mandatory funding to go to vine research at DAvis, he says the university hasn't produced any worthwhile improvements. Hoobooooy, that is a bit of a surprise. It all points to an inherently fragmented business. And the Australia govt. promotion started out well and in my opinion was murdered by Yellow Tail knocking the credibility of all Oz wine over $12 down the drain.
So, I think Rob is right notwithstanding his eccentric politics (hee hee hee) and writing style. Napa Cabernet is still a "brand", but not much else is recognizable anymore. Zins running 16% abv. have hurt, not helped the sales of the category, I venture. There is a lot of stuff that goes on in the consumer's minds that are either sub conscious or very near that, but are their guides. And a few unwanted results in any brand or price range or category can shut off that brand or category to the consumer, especially because THE REASON for a consumer not liking a wine, is so hard for the consumer to figure, because the industry does a great job of lying to the consumer all the time about hand-picked, family roots, selected coastal vineyards, etc. etc. on $8 wine with heavy oak and 1% RS. Consumer does not know what it was the turned him off to the bottle and the bottle offers no clue to guide consumer in the right direction. At least the German wines tell you the harvest level and other important FACTS, but since we don't read German, it is not much help. And there is no way that any American group will agree to anything near the German standard for wine labeling. Imagine a govt. rule stating minimum harvest dates & brix #s for two or three quality levels of domestic wine. Or Rioja system of Crianza, Reserva, and Gran Reserva, each legally defined and limited. At least the consumer could learn what they mean. But snowball chance in Inferno of any meaningful labeling law here. So, fragments and shards of fragments will continue to be the norm.
MAWine - thanks for the insightful thoughts. You point out the crux of the problem with getting a mandatory marketing order in place: fragmented interests.
DeleteThe large wine producers are sourcing generic wine world-wide and making razor-sharp decisions on wine based on movements in exchange rates. They need to do that to sell that much wine. But they have no need to promote the product or CA grapes. Promoting the grapes only increases their costs from their perspective (never mind it also promotes higher margins for them.) And when it comes to marketing, they'd naturally rather promote their own brand than a region. Since they source world-wide, they are at best agnostic about promoting a wine and would fight against the implementation of a formal marketing order.
The AVA's would benefit along with the regional growers associations by supporting the marketing of their regions but supporting the broader marketing of CA wines as a product. But they see their regions quality as the thing that needs promoting, versus any notion of growing the whole pie nor is there any consideration to mass consumer marketing because the regions alone can't afford it ... so they never go there.
Family Winemakers and the Wine Institute do some really great things but have their own constituents are more legislative based in their missions.
Marketing Orders are written with varying by-laws. I believe on the Pistachio order, the vote was based on volume versus 1 person 1 vote. The largest producer decided they didn't want to pay and that ended that initiative.
There are no simple answers but there is a simple path: Leadership from someone in the CA Wine Industry to market to all the above named XXX.orgs, synthesize the opportunity and present a cogent plan that would add a bit of unity to all winegrape and winery operations in the State.
It’s not easy, but there is an opportunity if there is someone out there who can champion the cause and align interests.
This reminds me of the old joke "Where does the 800 lb gorilla sleep? - Where ever he wants to" ..California wines have become like that 800 lb gorilla...and thinking that no one will challenge him. A few months back I saw some one post a note in LinkedIn that he thought that the Californian wineries were becoming like those of Bordeaux..insinuating that they were above it all...I do think many wineries would take issue with that thought but it is almost like "OK...so what is holding you back".
DeleteTo a certain extent I see this attitude among all winemakers (& wineries)..."I am suppose to make good wines" and they want to leave the "other stuff" to other people. I keep hearing that the smaller wineries are run "by farmers" but if you make the best wine in the country but no one buys it how long can you keep making that really good wine?
Rob...you made a call to arms for a mass effort to promote that "800 lbs gorilla"...and yes they make 90% of all the wine made in the US but when a vast majority of the 7600 + wineries barely give marketing of their own product a second thought how can they think of getting behind an entire movement?
Great conversation here. My mind is full of thoughts on this and I will share a few of them. I have long felt CA wineries were missing the boat by not promoting a "made in CA" message. The purpose would be to educate the mas market and to build a "premium" for all CA made wines. With imports in the US strong and with a larger than ever amount of "price sensitivity"/value shoppers, such an effort could help CA wineries maintain their pricing. Of course, the vast majority of wine drinkers don't care where a wine is made, but who can blame then, no one has attempted to tel them otherwise.
ReplyDeleteI see a few challenges to this opportunity. How to fairly allocate the promotional costs? Can we expect Napa Valley (and other premium AVAs) producers to support a CA (statewide) message as they spend to promote a much narrower (geographically speaking) message? Lastly, what message about "made in CA" is supportable AND compelling to consumers?
It is truly exciting to speculate on the possibilities around this and only the absence of passion and committtment would continue to deny the realization of the upside here to all CA wine producers. (BTW, nice to see a mention of ISC. I started my career in the wine business with ISC, not long after the "little ol wine maker" was given a rest.)
Pat - Thanks for chiming in with your expert and experienced opinion. Some of the biggest growth in the wine business came about because of ISC commercials. Since then, we've all lived in an isolationist enclave unspotted by world economics really, and been witness to the greatest change in consumer wealth ever (and the greatest destruction) along with year after year of quality and price improvement. We produced what we drank, but those days are done.
ReplyDeleteIf we want to sustain price in either the high volume or the hand-crafted segments, we are going to need to return to basics and begin taking up the challenge of making sure our own consumers know what kind of value they are getting. Yes they are more expensive wines but they are still a value. That sustains the price points in the business and the land costs that support the growers.
Mark and Pat - Totally agree. There are TREMENDOUS challenges to getting it done as I eluded. They might be too big to overcome. But the biggest is short-sighted self-interest. It reminds me of the Japanese story that talked about the man with holes in his roof. Every time it rained, he would put pots down. When asked why he didn’t just fix the roof, his response was. "It’s not leaking when there's no rain."
Its overcast right now and we can fix the roof with a coordinated campaign supporting CA wines. Or ... we can wait until the roof leaks and just put pots under the leaks.
MAW,
ReplyDeleteInteresting comments/observations, mostly in line with mine.
When I stated that I left some bottles with retailers it was only AFTER I tasted them on wines and by their own requests. I understand that face to face is the way to go, as most of us do. But so far no one picked on that other comment I posted, about a distributor NOT delivering wine with customers asking for it, practically begging for it. I had same thing happen in NY/NJ, AZ and IL, accounts calling me directly and asking what is going on. Our CA distributor, even after I spent 2 hours talking with their ENTIRE sales force and tasting that ENTIRE sales force on all the wines, discussing everything and providing material on wines and winemaking, then were caught in local shops not even remembering we are in the book. Marketing, in MY case, was not a question mark, I did more than most in working with customers directly, AND distributors, what then am I expected to do when distributors tell their sales guys to push other labels?